Corporate guarantee for ₹ 50 Crore credit facilities to subsidiary discharged/released by YES Bank
Ratnamani Metals & Tubes has informed exchanges that the corporate guarantee it had issued for credit facilities of up to ₹ 50 Crore to its subsidiary, Ratnamani Finow Spooling Solutions Private Limited.
- Guarantee Amount
- credit facilities of up to ₹ 50 Crore
- Lender / Guarantee Holder
- YES Bank Limited
- Beneficiary Subsidiary
- Ratnamani Finow Spooling Solutions Private Limited
What the company has informed
- Ratnamani Metals & Tubes Ltd has told the exchanges that a corporate guarantee it had issued has been discharged / released by YES Bank Limited.
- The guarantee related to credit facilities extended by YES Bank to Ratnamani Finow Spooling Solutions Private Limited (RFSS), a subsidiary company.
- The guarantee was issued to the extent not exceeding ₹ 50 Crores, which the company had intimated through its letter dated August 5, 2024.
- The company said the intimation of the release was received from the bank today at 11:17 A.M.
What a corporate guarantee is
A corporate guarantee is a promise by one company to repay a loan or credit facility taken by another company if that other company does not repay it. Here, the parent company had stood behind certain credit facilities of its subsidiary. Such a guarantee is a contingent obligation: it does not become a borrowing of the guarantor unless it is actually invoked.
What the release means
- The bank has discharged / released the guarantee, so the company is no longer standing as guarantor for those particular credit facilities of the subsidiary.
- A released guarantee means that contingent obligation no longer sits against the company for these facilities.
- This intimation concerns the subsidiary's credit facilities with the bank. It is not a statement about the company's own borrowings or its own operations.
Key points to note
- Amount of the guarantee: not exceeding ₹ 50 Crores
- Guarantee holder / lender: YES Bank Limited
- Beneficiary of the credit facilities: Ratnamani Finow Spooling Solutions Private Limited, a subsidiary
How a reader may see this
The release of a guarantee removes a contingent obligation the company had taken on for its subsidiary's credit facilities, and the communication itself is an intimation to the exchanges of that development.
More numbers
- Corporate guarantee amount (subject line)₹ 50 Crore
- Corporate guarantee amount (body of letter)₹ 50 Crores
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